By Colombo Telegraph

Dr. Liam Fox calls on President : As the Shadow Defence Secretary of UK Dr. Liam Fox called on President Mahinda Rajapaksa at President’s House 28 August 2009. Secretary to the President Lalith Weerathunge, Minister Mahinda Samarasinghe, Central Bank Governor Ajith Cabraal and Assistant to Dr. Liam Fox, Adam Werrity were also present.

The defence secretary Liam Fox’s friend for 30 years Lord Bell, whose PR firm Bell Pottinger was employed by the Sri Lankan government until last year to improve the country’s reputation abroad, said the deal had been struck between Fox and the head of the Sri Lankan bank: “In order for these funds to operate they would need an agreement with the country. The financial interests of Sri Lanka come under the governor of the Central Bank.

The defence secretary Liam Fox was intimately involved in negotiations with the Sri Lankan regime as recently as last summer, according to Lord Bell, agreeing a deal that allows the Sri Lankan Development Trust to operate in the country in the same period in which he now says he withdrew his involvement. The trust was a venture designed to rebuild the country’s infrastructure using private finance with a sideline in charitable projects for Tamil communities.

In June 2010, Fox met the Sri Lankan foreign minister in Singapore, along with Werritty and MoD officials. “The purpose of the meeting was to make it clear that although I would no longer be able to participate in the project, the others involved would continue to do so,” he said on Monday. But Bell told the Guardian on Thursday that discussions took place last summer in which Fox agreed with the governor of the Central Bank of Sri Lanka that the trust would invest in roadbuilding and other infrastructure projects using private investment.

Sri Lanka’s Central Bank Governor Ajith Nivard Cabraal confirmed to BBC 22^nd October last year that the government had hired a few PR companies. But he refused to reveal the amounts paid. “So many people are spending huge sums of money to tarnish our country’s image. Media institutions are also involved in this. We will do everything possible to boost that image and I believe it is our duty,” he told the BBC.

According to the informed sources Sri Lankan government has paid the British PR firm about £3m ($4.7m) last year to try to enhance the country’s post-war image. Bell Pottinger – whose motto on its website is “Better reputations, better results”

When a request was made under the Freedom of Information act, the chairman of Bell Pottinger’s parent company, Chime Communications, told the BBC Sinhala service that the act only covers UK government departments and certain contractors. “Further I must tell you all our client contracts are commercially confidential – consequently we cannot supply the information you seek,” Lord Bell said last year.

“Liam Fox told the house about the trust on Monday. It’s clearly not a full explanation. If he was still striking deals with the Sri Lankans last summer, how does that fit with official UK foreign policy? He has to explain these negotiations. You can’t have a situation where a government minister is appearing to run a completely separate foreign policy from that of the government.” Kevan Jones, shadow defence minister, said. Labour urged the government to come clean on Fox’s work in Sri Lanka and whether it might have contravened the government’s official policy, while a senior Whitehall source said the minister had been operating a “maverick foreign policy” and it is this that will ultimately decide his political fate.